The business of art is a moving affair

Marc Pallisco

PROMINENT Sotheby's Australia chief executive Gary Singer is paying $4.2 million for what will eventually become the Melbourne headquarters of the fine-art auction house.

Mr Singer, a former deputy lord mayor of Melbourne, has purchased levels seven and eight of a distinctive 21-level strata office building at 41 Exhibition Street that is being developed by the Royal Australian Institute of Architects and due for completion next year.

The Slater & Gordon site where Julia Gillard worked in the 1990s is changing hands. Photo: Ken Irwin

The RAIA will occupy the lower four levels of the building. Strata suites were marketed by Alexander Robertson's David Combes (see the next story for more on Combes) and ex-CBRE agent Sebastian Drapac.

Sotheby's Australia confirmed the purchase when contacted. Until the Exhibition Street space is ready for occupation next September, the company will lease the upper two levels of nearby Anzac House at 4-6 Collins Street from the Returned and Services League. Mr Singer was an unsuccessful candidate to become lord mayor this year.

Agency changeover

OWNERSHIP of commercial agency Alexander Robertson is set to change again.

Agent David Combes, a part-owner of the mid-tier agency since 2005, is quitting the business to work for a client, Drapac USA, and live in Los Angeles.

Combes, who started his property career as a graduate with CBRE in 2000 before moving to Jones Lang LaSalle, purchased a share of Alexander Robertson controlled by Sandy Robertson, who died suddenly almost seven years ago, age 43, while playing golf at a hospital fund-raiser. Combes leaves the country this week.

Looking for Eden

WITH permission recently granted to build Eden, an 11-level tower atop a four-level podium on a riverside block in Abbotsford, developers are now pressing council to ease restrictions preventing them from profitably redeveloping other pockets of the inner north-eastern suburb.

The Yarra City Council is reviewing a rezoning application that would see a 500-square-metre floor limit removed from two major sites in Mollison Street, Abbotsford, near Victoria Crescent, which runs along the Yarra River, also the suburb border to ritzy Kew.

The largest site, known as 32-68 Mollison Street, occupies almost all the northern half of the block east of Nicholson Street. Until this year, part of the double-storey warehouse on the site was occupied by Roving Enterprises, the production company of Rove McManus, who is now US-based.

A second, smaller site known as 61-69 William Street, but with frontage to Mollison Street, is also the subject of a rezoning. The assets are controlled by a Melbourne-based residential developer.

Both sites are near the former Denton Hat Mills factory which was redeveloped into apartments about four years ago. They are a short walk to the Victoria Street restaurant strip.

Not far away at 677 Victoria Street, in 2010, the Victorian Civil and Administrative Tribunal supported the Yarra City Council permitting a low-rise office on the banks of the Yarra River be replaced with a 586-unit residential project marketed as Eden.

Herzog property sale

DAVID and Ruvi Herzog, who ran the successful First Auto Wholesalers dealership established by their late father, Izzy Herzog, are selling a high-profile Port Melbourne commercial property developed in the 1990s.

The 65-67 Fennell Street asset abuts the West Gate Freeway and is within a 240-hectare precinct recently gazetted for high-density redevelopment as part of plans to rebuild Fishermans Bend as four residential-based villages.

The 4514-square-metre site, with future mixed-use redevelopment potential, is expected to fetch about $8.5 million. The family is also selling an adjoining 1555-square-metre lot at 69 Fennell Street for $1.3 million. In 2008, the Herzog family sold a Southbank development site to residential developers for about $23 million.

The family still owns a substantial property portfolio centred around Port Melbourne and South Melbourne. Vinci Carbone will auction the Fennell Street assets.

Healesville buyer

AUSTRALAND is understood to have found a buyer for its Healesville Walk Shopping Centre, about 50 kilometres east of the CBD.

The developer and fund manager listed the asset for sale via an expression of interest campaign that closed last month. It is understood a local private investor is negotiating to buy the asset for about $22 million.

At that sale price, and based on the shopping centre's potential annual rental return of $1.6 million, the asset will trade at a low yield of less than 7.5 per cent.

Australand paid almost $19.5 million for the asset in 2007, subsequently doing some refurbishments.

The 4971-square-metre shopping centre occupies a 1.3 hectare block with three street frontages.

Supermarket Coles is the anchor tenant, surrounded by 12 specialty shops and a kiosk. The centre includes 203 car park bays and has future redevelopment potential.

CBRE agents Mark Wizel and Justin Dowers and Savills' Dominic Long and Pat De Maria declined to comment on the campaign.

Wiping the slate clean

THE formal sale campaign for another $20 million-plus commercial asset also closed last month.

Sources expect a new buyer will be announced before the end of the year for 533 Little Lonsdale Street, a building owner-occupied in the 1990s by law firm Slater & Gordon - which has become a household name since its history with Prime Minister Julia Gillard became public recently.

Known as the Dominion building, the office was listed by asset management group Cyre Trilogy. Since being developed in 1991, the 15-level, 6608-square-metre office has been owned by wealthy identities including late billionaire Richard Pratt, who sold the building to S&G for $7.5 million in 1997.

S&G occupied the building with Mr Pratt's Visy Industries for a while but sold the asset in 2000 for $11.75 million. The law firm has since relocated to a larger Melbourne headquarters at 485 La Trobe Street.

Dominion was being marketed by agency Knight Frank with a potentially profitable planning scheme allowing the space to be subdivided into strata office suites that could be sold individually to small investors and owner-occupiers.